Interest rates in the UK are looking likely to rise later this summer. So investors could be able to lock in attractive passive income via Cash ISAs. However, the stock market could offer a better option. Its elevated dividend yields provided cash payments, albeit with higher potential risk.

So if someone has £14,285 in savings, here’s how a four-figure income could be generated.

Risk and reward

One of the first things to decide is the risk-tolerance level. What I mean by this is the yield possible on the savings can vary. It depends on how much risk the investor’s willing to take on. For example, the FTSE 100 average yield is 3%. Imagine an investor bought a dozen stocks around this level. It’s plausible to have quite low risk that a company’s going to stop paying the dividend.

Yet if someone targeted stocks from the FTSE 100 and other areas from the stock market that yield 8%-10%, the risk’s higher. It could be that the high yield is caused by a falling share price. This could mean in the future the passive income payments are cut as the business struggles.

Yet at the same time, there are some great stocks with high yields that are sustainable. The reward can be justified, but it depends if the investor’s happy with it.

Let’s say someone targeted a dividend yield in between the two options, at 7%. In this case, £14,285 added to this portfolio could yield £1,000 over the course of a year. Of course, this isn’t guaranteed. But if someone can focus on buying good-quality stocks with a track record of paying out dividends, it can help ease some concern.

Tapping into a growing market

One example to consider is Supermarket Income REIT (LSE:SUPR). The share price is up 8% in the past year, with a current dividend yield of 7.14%.

The real estate investment trust (REIT) owns a portfolio of supermarkets let to leading operators such as Tesco and Sainsbury’s on long-term leases. The sites are also increasingly being used as fulfilment hubs for online grocery orders, making them strategically important assets for tenants and providing the firm with dependable rental income.

Part of what has helped the share price performance over the past year is strength in the supermarket sector. In the latest half-year report, the business noted “non-discretionary grocery spend continues to demonstrate growth”. Basically, if the tenants are doing well, it’s good news for the REIT.

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Looking ahead, the report also said “the growth opportunity within grocery real estate remains highly compelling with supermarket sales reaching record highs in December 2025″. This should allow it to deploy more capital this year, which should start to generate income quickly.

This is supportive of the dividend too. With rental income underpinned by long leases, high occupancy and tenants operating in the grocery sector, cash flows have remained resilient. In fact, talking of the dividend, “the company is now targeting a sustainable minimum dividend uplift of 2% per annum for FY27.”

One risk is rising interest rates, which will directly feed through to higher rates payable on new borrowings for projects. However, I still think it’s a good stock for consideration by investors looking for passive income.

Should you invest £5,000 in Supermarket Income REIT Plc right now?

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Jon Smith does not hold any positions in the companies mentioned